Public Bill Committee

[Mr. Christopher Chope in the Chair]

Further written evidence to be reported to the House

LGPI 08 Patient and Public Involvement—Specialist Forums of North East England
LGPI 09 Local Government Information Unit

Phil Woolas: I beg to move,
That the Order of the Committee [30 January] be varied as follows—
In paragraph 1(d) leave out ‘and 2.00 p.m.’.
Thank you, Mr. Chope, and welcome to a traditional-style sitting of the Committee. The amendment is proposed on the basis of advice from the usual channels that, due to the inclement weather inthe south-east of England, we should not meet this afternoon.

Alistair Burt: I echo the Minister’s welcome to you, Mr. Chope, to these formal sittings in the more familiar surroundings of this Committee room.
On behalf of the official Opposition, I am happy to agree to the amendment. [Interruption.] There could not be a better reason for the amendment than the bedraggled state of the hon. Member for Bedford, who has arrived at exactly the right moment. There could not be a more fitting example of why the amendment is necessary. Even beyond the south-east of England,the situation is quite bad, and colleagues who haveto go back to other ends of the country will welcome the amendment, as may some members of staff.The amendment has arrived in the nick of time, notwithstanding the fact that the whole country seems to grind to a halt if there is half an inch of snow somewhere.

Phil Woolas: The south does; we do not.

Alistair Burt: Some of us northerners might be more hardened. However, communications can be difficult and airports are closed, so I am sure that the amendment will make things more convenient for all.

Andrew Stunell: I welcome you to the Chair, Mr. Chope. It is a delight to take part in a debate that for once is not about Shrewsbury. I agree with the proposed amendment.

Question put and agreed to.

Clause 25

Directions: further provision about reserves

Question proposed, That the clause stand part of the Bill.

Robert Syms: It is a pleasure to serve under your chairmanship, Mr. Chope. The clause deal with directions under clause 24, and mentions financial reserves. Will the Minister define financial reserves? Does it include schools balances?

Phil Woolas: While I wait for inspiration, perhapsI should explain what the clause seeks to do. The explanatory notes say that clause 25 is consequential on clause 24 and relates directly to it. It provides thata direction under clause 24 may provide that, if an authority seeks to apply financial reserves to reduce its budget requirement for council tax purposes, consent is not required in relation to financial reserves
“of a description specified in the direction”.
Likewise, the direction may provide that consent is unnecessary for application of financial reserves below a certain amount.
Hon. Members will be aware that school reserves are reserves that belong to the school—that has been the case since the legislative changes made by the House. Although the calculation of balances and assets includes school reserves, those reserves are ring-fenced, so they cannot be accessed for council tax purposes or, indeed, other purposes outside the remit of the school. The reason for inclusion is that school reserves are part of public sector assets and are therefore related to the public sector borrowing requirement. Many local authorities think that the situation should be otherwise, but Parliament decided that school balances should be treated in that way.
A second, related factor is that of the requirements and guidance of district auditors on what constitutes a reasonable level of reserves for local authorities, which varies between authorities, but which a direction under clause 24 cannot overturn. The Secretary of State may decide that consent is not required for, say, insurance reserves. That is because an authority might require its insurance reserves to be available for use at any time and needs to adjust them annually to reflect changing risk costs. Therefore, it might be appropriate for the authority to budget to use some of those reserves to reduce the council tax. As a consequence, it is not possible to say that all reserves are treated exactly the same. One would have to make a direction in light of the provision that has just been made.

Robert Syms: I think that I am beginning to understand what I asked. There may be various reserve funds, and some wriggle room for the local authority in termsof general day-to-day management that would presumably be approved in the order. Otherwise, the authority would have to go back to the Ministry every 10 minutes to ask, “Can we buy X or Y?” Is that how it would operate? The term that we used the other day was “financial envelope”. The Government would specify that an authority could spend a certain amount, but for anything over that amount the authority would have to go back to the Secretary of State for permission.

Phil Woolas: The Secretary of State would haveto take into account the overall situation of local authority reserves, and therefore of borrowing requirements, and the assessment of the individual authority. If, for example, a local authority undertook a one-off public event that required a significant amount of liability to cover it, it could reduce its reserves and liabilities accordingly. There are many other examples in which the level of reserves, or rather the guidance about the level of reserves, would change as a result of councils’ decisions.
The clause provides the Secretary of State with leeway to allow exemptions in some areas, but the general rule as laid out in previous clauses could not change. The clause means that the Secretary of State can provide that authorities do not need to seek consent to apply some particular types of financial reserves or reserves below a certain amount. Therefore, it gives some common-sense room for manoeuvre.

Question put and agreed to.

Clause 25 ordered to stand part of the Bill.

Clause 26 ordered to stand part of the Bill.

Clause 27

Consideration to be taken into account for purposes of direction

Alistair Burt: I beg to move amendment No. 53, in clause 27, page 16, line 23, leave out ‘31 December 2006’ and insert
‘the commencement date of this Part’.

Christopher Chope: With this it will be convenient to discuss amendment No. 54, in clause 27, page 16,line 32, leave out ‘31 December 2006’ and insert
‘the commencement date of this Part’.

Alistair Burt: The purpose of the amendment is twofold. First, it would uphold the principle that activity under the legislation should not anticipate its passage by the House. Secondly, it would give a little flexibility to local authorities. During debate on an earlier clause, we discussed what would happen to those authorities that are in the process of disposal as a result of the amalgamation of authorities or a change in the nature of an authority due to the switch from two-tier to unitary authorities.
The clause provides some flexibility for those authorities that might be in the process of negotiating contracts. Notwithstanding the fact that the procedure does not prevent any contracts from being entered into, it does stipulate that consent must be applied for and given by persons specified under the Act. Who knows what negotiations authorities are having about their internal processes? The process of decision making from two-tier to unitary is going to take some months. As we have discussed, the proposed timetable has not given some authorities much chance to prepare for the process, and they could be quite far advanced in  negotiations. If they are now required to go through a procedure in which they have to apply for consent, how long will it take for that consent to be given? Have the Government published what protocols have to be observed before consent is given? Is there a time scale for due diligence by the Government or specified persons so that they can look at contracts and see whether they should be allowed permission to proceed? What will be the implications if contracts are not allowed to proceed because the Government take the view that they are inappropriate? What reference criteria will the person specified use to make a decision on whether a contract is appropriate?

Andrew Stunell: Does the hon. Gentleman agree that decision making has been frozen in the 26 local authorities that have tabled bids, not simply those authorities whose bids may be subject to ministerial approval?

Alistair Burt: The hon. Gentleman is absolutely right. Nobody knows which bids will be accepted, but all the authorities are potentially in a hiatus. I do not know whether the procedure that local authoritiesare going through requires them to submit to the Government a list of contracts or potential contracts that they are negotiating. I do not know whether the Minister has such a list.
Amendment Nos. 53 and 54 are not asking for some great spend-up by authorities, but would provide those authorities with some flexibility to make their own decisions in the next few months. The authorities know the process through which they are going, and that they have to prove certain abilities to the Government if they are to have their bids for unitary status accepted, so they are hardly likely to be in a position tomake crass decisions or behave irresponsibly. The amendments recognise that sense of responsibility and would give authorities the flexibility to make their own decisions for a period, notwithstanding the bid procedure.
The amendments test out what the Government means by devolution and control. The Government could take the power and authorities should behave responsibly. However, here is a situation in which authorities are very likely to behave responsibly and do the work that they need to do. They do not know what the future will hold, but for six months or more, they could be in the position of being unable to make contractual decisions on their own account. I would therefore argue that there are perfectly valid reasons why they should be able to carry on, as opposed to having an arbitrary date forced upon them.

Andrew Stunell: I rise to support amendment No. 53, and to make the point that the huge majority of local authorities will be careful and prudent in the face of clause 27. They will not follow the example of the urban district councils of which the hon. Member for Denton and Reddish and myself are aware. In the past, those councils sometimes produced poisoned pills. Bearing that in mind, the Minister may wish to take a second look at the matter. Effectively, an authority that is submitting a bid cannot reasonably enter into a contract to, for instance, start a new school building or trade housing, until it knows whether it is going to have its bid approved and what its spending levels will be.
Were the Minister at all tempted to accept amendment No. 53, he could be entirely satisfied because clause 29 (1)(b) will give the Secretary of State the absolute power to
“substitute another date for the time being specified insection 27(1) and (3).”
In fact, clause 29 is a complete bypass of clause 27.

Phil Woolas: I congratulate the hon. Gentleman on the diligence he has shown in spotting that, althoughit is not quite as relevant as he has made out. Ican reassure the hon. Members for North-East Bedfordshire and for Hazel Grove that the intent and scope of clause 27 is not as they fear. Both the House and the Department will have experience of this issue, not only from urban district councils, but from the wider reorganisations of the early 1970s and the 1990s. Clause 27 is informed by those experiences.
Indeed, the hon. Member for Lichfield may not have realised how apposite his comments about the Lichfield mace were. There are provisions in local government reorganisations that relate to ceremonial issues, and legislation and direction has been necessary to ensure the protection of ceremonial assets for the people of an area. If my comments were an attack on the Lichfield mace, I regret them. I assure the hon. Gentleman of its safety under this Government and the Bill—just in case he is tempted to write a press release this weekend. [Interruption.] My Whip is looking at me.
Clause 27 provides for circumstances in which only disposals or contracts entered into by authorities that are to be wound up and that are subject to directions under clause 24—and only those—would countfor the purposes of the financial limits set out inclause 24. The provisions of the Bill became known on 12 December 2006, and when an authority disposes of land or enters into certain contracts, the clause refers to decisions taken after 31 December that, subsequently, also become subject to the direction under clause 24. In those cases, the value of the disposals or contracts made after 31 December will be taken into account in determining whether the authority has to seek consent for further disposals of land or certain contracts after the date of the direction. That is the fair point about which the hon. Member for North-East Bedfordshire was concerned, and had his interpretation been correct, I would have agreed with him. It would have involved an unreasonable burden on a local authority.
Contracts that will be caught are those entered into by the authority after 31 December, but before the direction was issued, and are those contracts with the same person and/or those that relate to the same or similar description of goods or services. For example, if an authority disposes of land worth £60,000 on2 January 2007 and subsequently becomes subject to a direction order under clause 24, and if it then seeks to dispose of a further piece of land worth, say, £50,000 after the date of the direction, it will need to seek consent for that further disposal because the value of both transactions is £110,000, which is more than the £100,000 consideration limit. Hon. Members can see that we are trying to ensure that, if there were a vexatious attempt to dispose of assets to jeopardise the sustainability of the future authority, the clause would deal with that circumstance.
These are sensible, common-sense measures. The amendment would wreck the procedure. However, I would not describe it as a wrecking amendment, because I genuinely do not believe that that is its purpose, but it is not just a probing amendment. There is a genuine fear behind what the hon. Gentleman said. The amendment would amend the date from which any disposals or contracts entered into would count for the purposes of the limit set out in clause 24. There are requirements of consent from the Secretary of State before an authority that is to be dissolved can make disposals or enter into contracts. The effect of the amendment would be that councils that are to be wound up would be free to make disposals or enter into contracts until that time, which could result in those authorities that are to be abolished acting irresponsibly and purposely disposing of assets or entering into contracts so as to have a negative effect on any new authority. The intention of the amendment is met by the clause.
 If I give some more figures, it may help the Committee to understand the experience that the measure is based on. If an authority were to dispose of parcels of land or enter into contracts for new arrangements that were outside the pattern of previous contracting, such issues would be taken into account. There were many examples from the previous restructuring round when authorities that were to be wound up acted irresponsibly. I emphasise that not only did the urban district councils enter into such decisions.
We are not trying to restrict local authorities from making valid disposals or entering into necessary contracts, as consent may be given. It is simply a measure to protect the asset base of future unitary authorities.

Alistair Burt: I asked about the procedure to be gone through to obtain consent and how long consent might take in certain circumstances. Does the Minister have anything to say to the Committee about that? Can he reassure authorities how quickly decisions can be taken because some contractual negotiations could have been going on for some time and the speed of decision could be of the essence? It will be delayed by the process that he is describing.

Phil Woolas: The hon. Member for Hazel Grove feared that 26 authorities may have their decision making frozen as a result of this provision. I assure him that that will not be the case because only the decision on the direction would be affected. We do not know when that may happen, but it would only be when the direction is in place. Previous experience shows that, in such a transitionary arrangement, the Department would be in daily contact with the local authority concerned. The Bill provides for the provision of information so that such decisions can be taken.

Andrew Stunell: I see that the Minister is trying to be helpful, but I wish to illustrate my point by referring to Northumberland where a proposal from the county council would effectively get rid of the districts and a proposal from the districts would effectively get rid of the county council. It therefore seems likely that the finance and legal officers in all those authorities would say to their decision takers, “You need to be aware that the Minister might be issuing a direction on this particular transaction, and the consequence of that would be to slow down matters in each authority.” Can he give us an assurance either now or at a subsequent stage that can lift that blight? Even now, there will be an inhibition on decision takers in local authorities who are far more frightened of the Minister than he realises.

Phil Woolas: I think I can give the assurances that the hon. Gentleman seeks. I recognise that a balance must be struck Opposition Members were expressing suspicions and anxieties about the short period of the window of opportunity. There is a balance to be struck between having a reasonable time to take decisions, but not too long a period that will bring about uncertainty in local government decision making. That affects not only the function of the local authority, but the employees and personnel within that local authority who have life decisions to make about their future as a result of the changes. That is why the matter is so serious. The hon. Gentleman’s point was reasonable.It is one that the trade unions have understandably made, too.
Experience shows that the shadow authority has used the direction in the most significant number of circumstances. The clause will allow for the Secretary of State to provide for those powers to the shadow authorities. That is to ensure that the new authorities work together in harmony, because there is a period between the decision and the beginning of the life of the new authority when the districts and county come together and personnel are being transferred. However, I shall not comment on what is happening in Northumberland.

Philip Dunne: Given that the clause is effectively retrospective and presuming that the Committee accepts it today, is the Minister already in discussions with some of the authorities that have put in for unitary status? To illustrate my point, the county council in my constituency announced last autumn that a new school would be built underthe building schools for the future programme—a£20 million investment in Much Wenlock that is very welcome. To get that school delivered on time, contracts will have to be placed in the first six months of this year, which is precisely the period that is relevant to the Bill. Could I ask the Minster whether Shropshire county council is already in discussion with his Department as to whether it will have permission to enter into that contract? If not, how does he propose to cope with such circumstances?

Phil Woolas: The hon. Gentleman presents me with two dilemmas. One is whether to mention his county and the other is that the Government are restricted as to what they can do in relation to conversations with authorities that have put in proposals or who are affected by such proposals. The Government’s policy and position is to remain neutral and objective so that we are able to judge the proposals against the objective criteria. Let me, however, give him the reassurance that he seeks.
The provision is not retrospective. It does not make unlawful any action that has been undertaken prior to the Bill’s enactment, but will allow decisions taken from 1 January 2007 to be taken into account in the decision to give a direction and thereby to provide power to the shadow authority to require consent. It will therefore allow decisions taken after 1 January on contracts and assets to be taken into account in the drawing up of those directions, should that be required, on the evidence of decision-making patterns regarding the disposal of assets or the entering into contracts.
I do not know whether the hon. Gentleman is familiar with the concept of unusual activity that the banks and the credit card companies use, but let me describe the situation in layperson’s terms so as not to cause parliamentary counsel too much concern. In his example, the normal course of business and the proper undertaking of the duties of that local authority would not be affected. Therefore we are not trying to restrict local authorities from making valid disposals or entering into necessary contracts. Let us remember that consent may well be given. The measure in the clause simply protects the asset base for the future unitary authorities.
I think my final point will give some assurance to the hon. Member for North-East Bedfordshire. If the date were to be amended to the commencement of this part or any date later than the one specified, that would increase the amount of time that the authorities that are to be wound up or that may choose to be so could act irresponsibly. It would have that perverse effect.I am sure that the Committee does not want to encourage that. I therefore encourage the hon. Gentlemen to withdraw the amendment.

Alistair Burt: I am happy with a number of the reassurances that have been given. I may come back to the issue at a later stage in the Bill’s proceedings but I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 27 ordered to stand part of the Bill.

Clause 28

Contraventions of direction

Question proposed, That the clause stand part of the Bill.

Robert Syms: In the debate on the previous clause, the Minister referred to a number of contracts and to parcelling that, as Members may know, takes place when a piece of land is sold in three pieces or a contract is let under four. I have always inclined towards the cock-up, rather than the conspiracy, theory, and I know that it is terribly difficult to define—I know the Bill is trying to do so—what is part of one contract. I can therefore see a situation in which an authority might inadvertently be caught up in exceeding the limits and contravening clause 24 for a worthy cause such as a children’s home, school or project with a general public benefit.
Clause 28 is a hard clause that makes various actions void. What flexibility will the Government have if there is a contravention of a direction made under clause 24? Will contracts automatically be made void, resulting in all sorts of legal action by the companies that have entered into agreements with a council, or will the Government have the flexibility not to implement a direction under clause 24? In other words, will they nod through a contract that contravenes it as the result of a cock-up or for a worthy cause, rather than leave a difficult legal jungle in which a private sector company will be left in limbo, not knowing whether it will be paid or whom it should sue?

Phil Woolas: The hon. Gentleman reinforces my view that he is a decent Conservative, because a decent Conservative believes in the cock-up theory of life. The former Minister for Higher Education, Lord Brooke, once said to me that the problem with my lot, by which he meant the Labour party, was that we believed in conspiracy theory, and the problem with his party was that they believed in the cock-up theory; but what I should understand was that they conspired and then cocked up. I have always remembered that, and I suspect that it is the case here. Experience shows that there are examples of decisions made deliberately to jeopardise the good running of a new authority and shadow authority.
The clause is not as harsh as it looks, but it is tough. It depends on clause 24 in the first instance and follows from it, and its meaning is that any disposal made without consent will be void—it will be treated under law as if it had never happened. Incidentally, the clause refers to disposals, not contracts.
Subsection (2) provides that any contract entered into without consent will not be enforceable against a successor authority, so the contractor will not be able to sue the successor for payment for work or services. Subsection (4) provides that a contract entered into without consent will not be considered a certified contract for the purposes of the Local Government (Contracts) Act 1997, meaning that the contract cannot benefit from the protection against legal challenge offered by that Act. The Secretary of State will ensure that information regarding any authority that is subject to a direction and the consequences of such a direction—that is the crucial point—is given wide publicity, including in the trade press, so that contractors are well aware that certain authorities will need to gain consent before entering into contracts.
I hope that the Committee will bear with me, as it is important to put this on the record. Subsections (5) and (6) provide that if an authority applies reserves to reduce its budget requirement for council tax purposes in breach of the direction, and only in breach of the direction, the authority will be treated as though it had not made its council tax calculations as required by the Local Government Finance Act 1992, and accordingly will not be able to collect council tax.
The hon. Member for Poole is right: those are tough measures—but they will be available only within the powers of the direction that we debated earlier. The measures are designed to ensure that there are consequences for authorities that choose to breach the terms of the direction—in other words, those that enter into conspiracies, not cock-ups. The intention is to ensure that authorities that are going to be wound up do not dispose of valuable land, enter into long-term contracts, or apply financial reserves above a limit specified by the Secretary of State, to reduce council tax without consent, all of which might otherwise have a negative effect on a new authority and, importantly, on the services available to people in that area. Essentially, the clause sets out the consequences for authorities if they do not seek consent either for disposals or before entering into certain contracts. I commend the clause to the Committee.

Question put and agreed to.

Clause 28 ordered to stand part of the Bill.

Clause 29

Power to amend

Question proposed, That the clause stand part of the Bill.

Alistair Burt: I am interested in the comments that the hon. Member for Hazel Grove made on the clause. The clause grants substantial powers, but the Minister indicated that it does not mean what we think it means. Will he enlighten us on why the clause is needed—particularly subsection (1)(b), which may not grant the wide-ranging power that the hon. Member for Hazel Grove believed it to, but about which Conservative Members are also concerned?

Phil Woolas: The clause allows the Secretary ofState to amend the amounts that are identified in clause 24(1)—the amounts above which consent is required for disposal of land or for certain contracts. Such amendment might be required if, for example, property prices or land values were to increase markedly. The clause also allows the Secretary of State to amend the date of 31 December, which we have discussed. The clause therefore allows the provisions of the Bill to be amended so that they are more workable—in the event, for example, that the decision-making process changed for some reason, perhaps because of the point that the hon. Gentleman madeon stage 2 of the consultation. It gives the Secretaryof State flexibility to make provision for changed circumstances.

Andrew Stunell: Will the Minister assure us that in no circumstances would the Government make the date earlier than the one set out in clause 27?

Phil Woolas: Not only will I do that, but I will add that the Bill would not allow us to make such a change. The date can only be changed to a later date, not an earlier one. Let me emphasise something else by way of further reassurance. The date is the date after which decisions can be taken into account. Neither an authority nor an official could be held to have acted unlawfully unless the relevant decision was taken both knowingly and after the date of commencement of the legislation, following Royal Assent. A change in date might come about if the Government issued another invitation after a direction made in the circumstances that we have already discussed—a slight boundary change or a consequential direction to propose, as a result of a solution being needed for an entire county area.

Alistair Burt: The hon. Member for Hazel Grove described the clause as one that neatly sidesteps the provisions of clause 27, and the dates set out in that clause. It seems to me that that is exactly what it does. If the Minister admitted that that is its purpose the point would be proved.

Phil Woolas: I like the word “neatly”, but I amnot sure that I like the implications of the word “sidesteps”. I would say that the clause “neatly” facilitates good local governance, and I commend it to the Committee.

Question put and agreed to.

Clause 29 ordered to stand part of the Bill.

Clause 30 ordered to stand part of the Bill.

Clause 31

Eligible councils

Andrew Stunell: I beg to move amendment No. 94, in clause 31, page 17, line 37, after ‘to’, insert ‘(a)’.

Christopher Chope: With this it will be convenient to discuss the following: Amendment No. 95, in clause 31, page 17, line 38, at end insert—
‘(b) a scheme for whole council elections’.
Amendment No. 96, in clause 31, page 18, line 2, at end insert—
‘(2A) A council is subject to a scheme for whole elections if, under the scheme for the ordinary elections of its councillors, all of the councillors are elected in each year in which the elections are held.’.
Amendment No. 98, in clause 32, page 18, line 13, at end insert
‘within eight years of a resolution being made in accordance with subsection (1).’.
New clause 6—Changing scheme for ordinary whole council elections—
‘(1) This section applies if an eligible council resolves, during a permitted resolution period, that the council is to be subject to the scheme for partial-council elections.
(2) The council ceases to be subject to the scheme for whole council elections.
(3) The council becomes subject to the scheme for partial-council elections.
(4) The council must not pass the resolution unless it has taken reasonable steps to consult on the change to partial-council elections.
(5) It is for the council to decide which persons it is appropriate to consult.
(6) No resolution of the council may reverse the effect of this section within eight years of a resolution being made in accordance with subsection (1).
(7) In this section “permitted resolution period”, in relation to an eligible council, means a period specified in the second column of the following table in relation to that type of council

Type of eligible council

Permitted resolution periods
Metropolitan district
(1) The period ending 31st December 2007 (2) The period in 2011, or in any fourth year afterwards, which—
(a) starts with 1st October, and (b) ends with 31st December.
Non-metropolitan district
(1) The period ending with 31st December 2010. (2) The period in 2014, or in any fourth year afterwards, which—
(a) starts with 1st October, and (b) ends with 31st December.
(8) The Secretary of State may by order provide that a permitted resolution period is to end later than the last day of that period specified in the table.’.
New clause 7—Scheme for partial-council elections—
‘(1) The scheme for partial-council elections is as follows.
(2) The term of office of councillors is four years.
(3) Elections of the councillors of the council are to be held in the year after the resolution is passed and every year after it other than every third year after it.
(4) One third (or as nearly as may be) of the councillors are elected in each year in which the elections are held.
(5) On the fourth day after elections are held—
(a) the councillors elected in those elections are to come into office, and
(b) the sitting councillors are to retire.
(6) In this section—
“resolution period” means the permitted resolution period in which the council passes a resolution for the purposes of section 32;
“sitting councillors” means the councillors who hold office at the time ordinary elections are held.’.

Andrew Stunell: It is important that we make progress today, so I shall try not to detain the Committee for long.
The group comprises a coherent set of amendments designed to give local councils the opportunity not only to switch from one-third or one-half elections to all-out elections, but to switch back the other way. Although that is rather intricate, because the proposals are wound so much into this part of the Bill, hopefully our amendments would allow that.
The Minister has talked a great deal about how he is freeing local government and giving it lots of choices, and about devolutionary government and amazing love and motherhood government. It is wonderful to hear him talk about that, but we are trying to coax him a little bit further so that he does not just give local government the freedom to move in the direction that the Government would prefer as far as elections go, but allows them the freedom to go in the other direction if they choose—to have a reversible process, or one that gives them equal freedom to go in each direction.
The evidence from the Local Government Association representatives was that although as individuals they considered that all-out elections were probably the way ahead, local government as a whole should have the option to go in the opposite direction. I have been a member of different authorities that have had both systems of election; we could rehearsethe advantages and disadvantages at some length. However, it is not for the Government to decide for local authorities which of the pros and cons ought to  take precedence in their decision making. We heard from Unlock Democracy, which made exactly that point, and, although it might serve to weaken my case, the Conservative leader of the district councils made the same point, too.

Alistair Burt: A fine man.

Andrew Stunell: Yes, and, at least on that point, I could rely on his evidence.
All these matters are of a piece. It would not be profitable to explain in detail how they all work, but I ask the Government to reconsider the provision. If the Minister wants to gain a reputation for assisting local government to deliver effective and representative government, he ought not to constrain it. In giving authorities the freedom to move to all-out elections, he ought equally to give them the freedom to move the other way if they choose to do so. There are things to be said on both sides; I shall not rehearse all the arguments, but give a few examples. What some regard as decisive change might be regarded by others as catastrophic change. Some have commented on the boom and bust of all-out elections and the remarkable way in which, in the year of all-out elections, council tax rises tend to be so much lower than in the other three years. And so the arguments go on.

Alistair Burt: In those circumstances, councils are only taking a lead and mirroring the example of the Government, which produces a council tax rebate in a general election year that mysteriously disappears the year after.

Andrew Stunell: I was tempted to use this place as an analogy, but I thought that, on the whole, I would steer clear of it. Its example is neither particularly good nor bad, but the point has been made. Sometimes, as in 1979 or 1997, there is revolutionary change and sometimes there is not. In the local government context, where there are elections by thirds or by halves, the decision takers are always looking over their shoulder. Ministers sometimes represent that as weak leadership, but actually it is responsive leadership: representatives are looking over their shoulder and considering what the public will do next May. In a representative democracy, what is wrong with that, for goodness’ sake?
I am not saying that local government should have election by thirds. I am asking the Committee and the Minister to consider making the second procedure open to local government, as well as the first one. Of course, on the whole, leaders in power prefer all-out elections every four years and oppositions out of power prefer elections every year. Whether the democracy that results is better or worse, the Minister will not be able to produce a scrap of evidence to show one thing or the other. It seems to us that there is every reason to give that freedom to local authorities, and I trust that the hon. Gentleman will agree to do so.

Robert Syms: I have to start off by saying that I have always had a natural sympathy for all-out elections because of their simplicity. There is a manifesto, people try to carry it out and others make a judgment. Having said that, I am totally opposed to the Government specifying solutions to local government because local tradition and practice are important. I have sympathy with the argument made by the hon. Member for Hazel Grove: why force a lever that forces change purely in one way? Choice about whether electoral systems should be whole, one third or one half rather than proportional representation should be down to local government.
The Government are again trying to make up the mind for local government, as they do in relation to committee systems and other matters. I hope that the Minister listens to the debate and reflects on it. We have heard much about devolution and bottom-up change and, if that really is the way to go, the hon. Gentleman’s amendment should be accepted.

Neil Turner: Hon. Members will see that I have tabled an amendment similar to that tabled by the hon. Member for Hazel Grove. To bring some colour back into the cheeks of my hon. Friend the Member for Chatham and Aylesford, let me say that I shall not be supporting the hon. Gentleman’s amendment. However, I shall be urging my hon. Friend the Minister to take account of what has been said.
We did not discuss the matter very much during the evidence session, but the hon. Member for Hazel Grove asked a question, to which the Minister replied:
“the Bill allows the process of change. It is about accountability and transparency for the electorate and our view is that all-out elections provide that in the best form.”—[Official Report, Standing Committee Local Government and Public Involvement in Health Bill, 1 February 2007; c. 92.]
I do not think that that is at all relevant to the Bill, which is about putting the decision-making process as far down the track of democracy as possible. The view of the Minister on election arrangements is not relevant. On Tuesday, the Minister said:
“The Government’s approach is devolutionary. It is for local authorities to tell us the best solution for their area. The reason for that, apart from what is apparent, is that the geographies and economies of local areas are very different.”—[Official Report, Standing Committee Local Government and Public involvement in Health Bill, 6 February 2007; c. 139-140.]
He is saying exactly what the Bill is all about. Its thrust is to push down the decision-making process as far as possible. I do not think that the logic of the clause as drafted stacks up in that regard.
I am making an assumption about what the Minister will say in response, but one of the things that may well be said that the Bill is about the provision of strong leadership. In other words, a four-yearly election gives a four-year leadership and a clear decision-making process. However, that does not stack up, either. There are clear sufficient safeguards in the Bill that will allow for strong leadership in those authorities that have elections by thirds or by halves. If that were so important, the Bill should have a clause stating, “Everybody shall go for all-out elections.” If that is the logic, the Government should be saying, “Make it so.”
Councils should not be subject to such provisions. I accept that there should not be a constant ping-pong whereby there is a four-yearly election, immediately after which, because a different party gets into power that likes elections by thirds, there is a change. We could make sure that that does not happen by having a clause in favour of an arrangement lasting eight years or 12 years. That seems to me to be correct. The arrangement would have time to bed in; people would understand the pros and cons, having been able to compare one type of election against another.
I do not think that this is a major issue: I cannot see The Times thundering about it, The Guardian railing against it, or The Daily Telegraph fulminating on it. I cannot see the Daily Mail saying three votes good, one vote bordering on autism; or the Daily Express saying that the issue is part of the great jigsaw of the Diana death syndrome. I cannot even envisage letters in the “Blagdon Advertiser” about it. Most people are not that bothered one way or the other. However, the people of a local authority area should be able to have election by thirds if they think that is correct. Having a one-way street goes against the whole flow of the Bill. The Minister should look against at the provision and allow local authorities the ability to move in both directions, if they so wish.

Andrew Gwynne: I draw hon. Members’ attention, yet again, to my entry in the Register of Members’ Interests. I support everything that my hon. Friend the Member for Wigan said. I believe that it should be up to councils to decide. I should state that I am biased because both the local authorities in my constituency elect by thirds: Stockport and Tameside are metropolitan boroughs and so have no option but to do so, but the system works well in both. If nothing else, it encourages political activity to take place all year round—or most of the time—in all of the wards in both boroughs.
I was elected under the system of thirds in 1996 and in 2000. Owing to the boundary changes of the wards in Tameside, the 2004 elections were all-out. That coincided with the European election and an all postal pilot, so the ballot papers were like Ordnance Survey maps. I ought to be biased in favour of all-out elections, because not only did I top the poll in my ward, but I topped the poll out of the 250 candidates for election to the 59 seats in Tameside—[Hon. Members: “Hear, hear!”]. But I am not biased in favour of all-out elections. I think that thirds is a preferable system, because it allows for greater activity, for long-term planning, and gives more certainty to officers and executive councillors.

John Pugh: The interesting thing about those all-out elections was that the results were not significantly different from when elections were by thirds. Does the hon. Gentleman agree that the political complexions of authorities did not change by much?

Andrew Gwynne: In Tameside, that seems to be an annual feature. The hon. Gentleman is entirely right, certainly with regard to the all-out elections in Greater Manchester.

Patrick Hall: We have heard quite a lot about Tameside, but it is important to get back to the standard established in the Committee of referring to Bedford and Bedfordshire. Although I agree with the points that have been made about the encouragement that year-round campaigning provides, there is an issue about continuity of leadership. It is possible to achieve a perfect solution, which has of course been done in Bedford: elections by thirds and a directly elected mayor.

Andrew Gwynne: I am not sure that I am qualified to comment on Bedford. In Tameside since 1980 we have been under the stable leadership of Councillor Roy Oldham CBE, who is the longest serving leader of any council in the country. That is what election by thirds has brought to Tameside.
Elections by thirds also bring stability for officers. They are able to plan ahead and see whether a council is likely to change control.

It being twenty-five minutes past Ten o’clock,The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till Tuesday 20 February at half-pastTen o’clock.